Sodium biphenyl is widely used as a reducing agent in organic synthesis and polymer chemistry. It is particularly effective in the initiation of anionic polymerization reactions, especially for the production of styrenic and diene-based polymers. Its strong electron-donating properties make it ideal for generating active anionic species from monomers like styrene, butadiene, and isoprene, enabling controlled polymer chain growth.

It is also employed in the deprotonation of weakly acidic compounds and in the preparation of other organometallic reagents. Due to its high reactivity, it is typically handled under inert atmosphere conditions such as nitrogen or argon to prevent decomposition by moisture or oxygen.

In industrial settings, sodium biphenyl helps achieve high molecular weight and narrow polydispersity in synthetic rubbers and thermoplastic elastomers, contributing to improved material performance. Additionally, it finds use in specialized chemical transformations where a powerful, soluble reducing agent is required.